Cyprus: setting sail for success

FDI
| The European | 16th November 2015
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maritime-post

Cyprus has become a fully established maritime centre, combining both a sovereign flag and a resident shipping industry, which is renowned for its high quality services and standards of safety. Cyprus is considered as one of the leading third-party ship management centres in the world. A significant number of ship management companies have been established on the island and manage a large proportion of the Cyprus merchant fleet as well as a significant number of vessels under foreign flags.

Cyprus, with its long maritime tradition, enjoys a leading role in the international shipping scene, by holding third place within the European Union merchant fleets and the tenth worldwide, while also having a leading as a major shipping management centre. Cyprus is among the top five countries and territories in the world with the largest number of third-party ship management companies on its territory.

The Cyprus flag is a high quality flag, offering numerous advantages to ship owners who register their vessels in the Cyprus registry such as:

Quality and service

  • Party to all international maritime conventions on safety, security, pollution prevention, maritime labour and health and safety, giving full and complete effect to their provisions.
  • Bilateral agreements on merchant shipping signed with 25 states, through which Cyprus ships receive either national or most favoured nation treatment in the ports of other states.
  • Comprehensive and pioneering legislation for the protection of Cyprus ships from piracy and other unlawful acts, including a legal framework allowing and regulating the use of private armed security personnel on board the Cyprus vessels in high-risk areas.
  • An EU flag, classified in the white lists of the Paris and Tokyo memorandum of understanding on post state control, resulting in fewer inspections of the ships and fewer delays at the ports of both.
  • Maritime offices in London, Rotterdam, Piraeus, Brussels and Hamburg, offering services to Cyprus ships at all times.
  • Efficient provision of services by the Department of Merchant Shipping 24/7.

Economic benefits

  • Favourable Tonnage Tax Scheme, approved by the European Commission.
  • No tax on income derived from the operation of the ship(s).
  • No tax on dividends paid to shareholders out of profits made from the operation or from the sale of the ship(s).
  • No tax on interest earned on working capital of the ship.
  • No tax on income, or profit made from the sale of the ship.
  • No tax on the salary or other benefits of the master, the officers and crew members of the ship.
  • Competitive ship registration costs and fees.
  • No estate duty on the inheritance of shares in a ship-owning company.
  • Full protection for financiers and mortgages.
  • No stamp duty on ship mortgage deeds or other security documents.
  • Treaties on the avoidance of double taxation with 50 countries.
  • Cyprus is a member of the eurozone.
  • Low set up and operating costs for companies.

Further information
www.shipping.gov.cy

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